Currency error in CAP system

£750k overpaid to farmers because of failure to correctly convert euros to sterling

Bungling officials overpaid loans to farmers because of a currency conversion blunder.

Nearly £750,000 will have to be returned to the Scottish Government by recipients of EU subsidies following the latest in a series of embarrassing foulups.

It has sparked a fresh round of criticism of the SNP’s controversial handling of the distribution of Common Agricultural Policy cash to farmers and crofters.

Human error in the conversion of euros into sterling meant that 166 businesses were overpaid a total of £746,000 in the November 24 run of the cash advance loan scheme.

Scottish Conservative MSP Jamie Greene, who sits on the rural economy committee, said the latest incident raises “serious questions about this Government’s ability to manage our rural economy.”

“The Scottish Government’s handling of rural affairs is increasingly worrying. We’re now approaching a full year of disruption for Scottish farmers.

“It’s astounding that the Scottish Government has wasted nearly £1m of taxpayers’ money because it couldn’t handle something as basic as working out the correct exchange rate.”

Mike Rumbles, for the Scottish Liberal Democrats, said Rural Economy Secretary Fergus Ewing has presided over a “horrifying comedy of errors” for the CAP payments.

“These farmers had no idea they were overpaid and receiving this unexpected invoice will surely be a blow,” he said.

The currency conversion error – which involved staff dividing rather than multiplying by 0.85 – has affected a quarter of the 602 businesses in the latest round of the loan payments.

The national loan scheme was set up to help cover businesses waiting for their basic and greening payments to be processed through the failing £178m IT system.

Leslie Evans, the most senior civil servant in the Scottish Government, wrote to the public audit to committee yesterday to inform them of the mistake.

“Whilst this is regrettable, officials took prompt action to alert businesses and avoid the possibility of the overpayments being inadvertently spent,” she said.

She added that just under 17,800 loan offers have been issued, with fewer than 100 “more complex offers” still to be made.